United States Securities and Exchange Commission (SEC) Chair Paul Atkins is considering establishing a “token taxonomy” at the federal regulator in an effort to clarify the classification of specific crypto assets, the agency head announced on Wednesday.
SEC Chair Paul Atkins Weighs Token Taxonomy
Speaking at The Federal Reserve Bank of Philadelphia’s FinTech Conference on November 12, Atkins announced that he is weighing the creation of a token taxonomy “anchored in the longstanding Howey investment contract securities analysis” as the next phase of the SEC’s “Project Crypto” initiative.
While Atkins assured that the taxonomy “aims to complement, not replace, Congress’s critical work,” he said that he views most crypto tokens as non-securities.
Atkins declared that he believes digital commodities, digital collectibles, and digital tools do not constitute securities, while tokenized securities do, as they “represent the ownership of a financial instrument enumerated in the definition of ‘security’ that is maintained on a crypto network.”
“A reasonable Commission approach to crypto will not by itself decide the fate of the market—or of any particular project,” Atkins said. “Markets will do that.”
“But it will help to ensure that the United States remains a place where people can experiment and learn, fail and succeed, under rules that are both firm and fair,” he added.
New Crypto Market Structure Draft Outlines SEC, CFTC Collaboration
Atkins’ commentary comes just days after Senate Agriculture Committee Chairman John Boozman (R-AR) and Senator Cory Booker (D-NJ) announced their own crypto market structure legislation discussion draft.
The draft specifically orders the SEC and the Commodity Futures Trading Commission (CFTC) to “collaborate on necessary inter-agency rulemakings.”
“As Congress works to expand authority for the commission to oversee the trading of digital assets that are commodities, it’s essential that we also ensure it has the tools, personnel, and resources necessary to carry out this new mission, along with its current responsibilities,” Boozman said.
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